Correlation Between Truscott Mining and Growthpoint Properties
Can any of the company-specific risk be diversified away by investing in both Truscott Mining and Growthpoint Properties at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Truscott Mining and Growthpoint Properties into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Truscott Mining Corp and Growthpoint Properties Australia, you can compare the effects of market volatilities on Truscott Mining and Growthpoint Properties and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Truscott Mining with a short position of Growthpoint Properties. Check out your portfolio center. Please also check ongoing floating volatility patterns of Truscott Mining and Growthpoint Properties.
Diversification Opportunities for Truscott Mining and Growthpoint Properties
0.23 | Correlation Coefficient |
Modest diversification
The 3 months correlation between Truscott and Growthpoint is 0.23. Overlapping area represents the amount of risk that can be diversified away by holding Truscott Mining Corp and Growthpoint Properties Austral in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Growthpoint Properties and Truscott Mining is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Truscott Mining Corp are associated (or correlated) with Growthpoint Properties. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Growthpoint Properties has no effect on the direction of Truscott Mining i.e., Truscott Mining and Growthpoint Properties go up and down completely randomly.
Pair Corralation between Truscott Mining and Growthpoint Properties
Assuming the 90 days trading horizon Truscott Mining Corp is expected to generate 1.7 times more return on investment than Growthpoint Properties. However, Truscott Mining is 1.7 times more volatile than Growthpoint Properties Australia. It trades about 0.08 of its potential returns per unit of risk. Growthpoint Properties Australia is currently generating about 0.0 per unit of risk. If you would invest 4.10 in Truscott Mining Corp on September 12, 2024 and sell it today you would earn a total of 3.70 from holding Truscott Mining Corp or generate 90.24% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 99.72% |
| Values | Daily Returns |
Truscott Mining Corp vs. Growthpoint Properties Austral
Performance |
| Timeline |
| Truscott Mining Corp |
| Growthpoint Properties |
Truscott Mining and Growthpoint Properties Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Truscott Mining and Growthpoint Properties
The main advantage of trading using opposite Truscott Mining and Growthpoint Properties positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Truscott Mining position performs unexpectedly, Growthpoint Properties can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Growthpoint Properties will offset losses from the drop in Growthpoint Properties' long position.| Truscott Mining vs. Black Rock Mining | Truscott Mining vs. MA Financial Group | Truscott Mining vs. Bank of Queensland | Truscott Mining vs. EP Financial Group |
| Growthpoint Properties vs. Centaurus Metals | Growthpoint Properties vs. Falcon Metals | Growthpoint Properties vs. Black Rock Mining | Growthpoint Properties vs. Truscott Mining Corp |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Investing Opportunities module to build portfolios using our predefined set of ideas and optimize them against your investing preferences.
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